Late West Publishing exec's words not allowed at fraud trial of ex-aide

A federal judge says prosecutors can't use the words of the late Gerard Leon Cafesjian -- namesake of St. Paul's famous carousel -- when they try his former assistant for fraud and income tax evasion next month.

John Joseph Waters Jr. is accused of stealing millions from Cafesjian, a former West Publishing executive who died in September.

Thirteen months before he died, Cafesjian was questioned by Waters under oath for a deposition in a civil case. A month after the retired executive died, Assistant U.S. Attorney William Otteson filed a motion to use the testimony against Waters at his trial, set to begin in Minneapolis on Feb. 24.

But in a ruling Wednesday, U.S. District Judge Ann Montgomery said that given the circumstances of the case, admitting Cafesjian's testimony in a criminal trial would violate the constitutional protection that gives criminal defendants the right to confront witnesses against them.

During the deposition in a civil case stemming from the alleged fraud, Waters -- representing himself -- questioned his ailing former boss. Otteson had argued that Waters had been given the opportunity to confront the witness, so there was no conflict with the Constitution.

Montgomery disagreed. She cited a precedent case in which the U.S. Supreme Court reversed the admission of prior testimony because the person doing the questioning -- who also represented himself -- lacked an attorney, and that meant the person did not have a "meaningful confrontation.

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In August, Waters, 57, of Eden Prairie, was named in a 26-count federal indictment accusing him of mail and wire fraud, income tax evasion and filing a false income tax return.

The indictment doesn't say how much Waters allegedly took from his employer, but in a civil suit Cafesjian had filed against the man, he claimed Waters embezzled at least $2.8 million between 2004 and 2009.

The criminal complaint alleges improprieties between 1999 and March 2012.

Waters had gone to work for Cafesjian at West Publishing in 1994, two years before Cafesjian retired as an executive vice president. Cafesjian, a major shareholder in the company, was known in part for his philanthropy and civic work. In 1988, Cafesjian led the effort to save the merry-go-round at the Minnesota State Fairgrounds.

Cafesjian and others contributed more than $2 million to save the 1914 amusement. The 68-horse ride was restored and renamed the Cafesjian Carousel. It is in a special pavilion at St. Paul's Como Park.

When Cafesjian retired, he hired Waters to manage his personal business affairs. Waters spent 13 years in that job.

By 2009, Cafesjian began to suspect Waters of financial misdeeds. But Waters filed a civil suit against his former boss, claiming he was owed millions in unpaid wages.

Cafesjian countersued, accusing Waters of embezzlement. A federal judge threw out Waters' original claim, leaving the countersuit, now on hold until the criminal case is resolved.